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Recent Court Ruling on Construction Act Transition Rules

Caledon (Town of) v. 2220742 Ontario Ltd

Ontario’s Construction Act had a phased implementation, with phase 1 in July 2018 and phase 2 in October 2019. Transitional provisions were put in place to assist the construction industry to implement the new rules on new contracts at each of those phases.

In August 2024, Ontario’s Divisional Court ruled on a court case where a single contract—covering multiple improvements—may be governed by different sections of the Construction Act transition rules. The ruling may potentially affect lien rights and obligations for all projects undertaken under the transition rules whether completed or active.

This recent article, co-authored by Bruce Reynolds and Nicholas Reynolds of the law firm Singleton Reynolds, may be useful for understanding some of the implications and risks as a result of the court ruling.

Architects may want to make their clients aware of the court ruling and suggest the clients review with their legal counsel the implications for current and completed projects done under the transition rules. The OAA’s Practice Advisory Services team will continue to monitor the impact of this court decision on everyday practice.

This article was originally in an issue of the Practice Advisory—a newsletter developed by the OAA’s Practice Advisory Services team, which offers numerous resources for both members and the public. The OAA does not provide legal, insurance, or accounting advice.

Readers are advised to consult their own legal, accounting, or insurance representatives to obtain suitable professional advice in those regards.

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